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- Asian shares edged up on Friday, on track for their biggest monthly rise since January 2012 but headed for weekly losses as investors fretted about the possibility United States interest rates could still rise this year. Japanese shares slipped briefly and then regained their composure, while the yen rose after the Bank of Japan held policy steady. The BOJ kept monetary policy steady as most had expected, but some investors had speculated the central bank would deliver some additional steps to support Japan’s economy, and many still expect it to eventually deliver more easing. The BOJ will release new long-term economic and price forecasts in its semiannual outlook report due at 3:00 p.m. (0600 GMT), and BOJ Governor Haruhiko Kuroda will hold a news conference at 3:30 p.m. (0630 GMT) to explain the policy decision. Core consumer prices fell 0.1 percent in the year to September, a second monthly decline, and while household spending slid 1.3 percent from a year earlier. The BOJ maintained its pledge to increase base money, or cash and deposits at the central bank, at an annual pace of 80 trillion yen ($662 billion) through aggressive asset purchases.
- U.S. economic growth braked sharply in the third quarter as businesses cut back on restocking warehouses to work off an inventory glut, but solid domestic demand could encourage the Federal Reserve to raise interest rates in December. Gross domestic product increased at a 1.5 percent annual rate after expanding at a 3.9 percent clip in the second quarter, the Commerce Department said on Thursday. The inventory drag, however, is likely to be temporary and economists expect growth to pick up in the fourth quarter given strong domestic fundamentals. The Fed on Wednesday described the economy as growing at a “moderate” pace and hinted at a December rate increase by making a direct reference to its next policy meeting. The U.S. central bank has kept benchmark overnight interest rates near zero since December 2008. The economy has struggled to sustain a faster pace of growth since the end of the 2007-200 recession, with average yearly growth failing to break above 2.5 percent. This year, it has faced headwinds from a strong dollar and deep spending cuts by energy firms following a collapse in oil prices. Businesses accumulated $56.8 billion worth of inventory in the third quarter, the smallest since the first quarter of 2014 and down sharply from $113.5 billion in the April-June period. There were declines in manufacturing, wholesale and retail inventories.
- Crude futures dropped in early Asian trading on Friday after the release of a report showing that U.S. economic growth had slowed sharply, reinforcing concerns about sluggish demand in a world awash with oil. U.S. economic growth braked sharply in the third quarter as businesses cut back on restocking warehouses to work off an inventory glut, data showed. The sluggish U.S. growth figures and weak home sales numbers have tempered the market’s positive reaction to government figures earlier in the week showing oil stockpiles last week had increased by 3.4 million barrels, which was below the estimate from an industry group.